www.iva.co.uk

I was previously in an IVA from September 2006 to September 2009. It was concluded early by way of a full and final settlement. I fully appreciate that it would be difficult if not impossible to get a mortgage with the IVA, albeit completed, still on my record. I had hoped that after 6 years when the IVA and all defaults have dropped off my credit report that I would be in a reasonable position but having read a few posts elsewhere recently it seems this may not be the case?

I am saving for a deposit and have 2 x credit cards (both with 2k limits) that were taken out after the IVA concluded are used regularly but ALWAYS paid off in full, the lesson has been well and truly learned about credit.

So, in late 2012 I will have:

No IVA or defaults on my file, no debt, positive credit history from the last 3 years (bank account never overdrawn, 2 x credit cards, 1 x store card, mobile contract) and hopefully a deposit although it is only likely to be a 10% deposit.

Obviously nobody has a crystal ball but going on todays experiences am I likely to be considered for a mortage at a reasonable rate once the IVA is completely off my file or does the fact that I have previously been in an IVA go against me regardless of how long ago it was? Do mortgage applications ask if you have ever entered into an IVA (I know they ask about bankruptcy)?

Would be grateful for any input [:)]

Hi comps,

At the moment, even with a perfect credit rating, you will find it difficult to get a mortgage without a hefty deposit which will probably need to be more than 10%.

If you are asked about bankruptcy on an application you can truthfully answer no, if it asks if you have ever entered into an arrangement with your creditors then you will have to say yes.

What i have heard on TV - was that although you may pay your credit card/store off monthly, they take into account the credit limit on these cards. And the potential availibility of credit. Not sure what other people think

I think that they all have to do so now. I know that the credit card rules have changed and you cannot just be offered a higher limit without a credit card. Also, if the interest rate goes up and you don't want to pay it, you can tell them that, send the card back and continue paying off the card at the original rate.

Would you mind saying who you managed to obtain credit cards with, as i completed a lump sum iva 2 years ago and wanted to apply for a card, obviously only to repair my credit history, like you i have learded an important lesson in life

the name of the one you hear the most here is Vanquis. Low limits and high interest.
Check the website its got a Q+A section

Vanquis are good, but it's not guaranteed acceptance as some posters have found when they've applied.

There's one called Granite as well which is supposed to be for poor credit ratings.

Apparently the Granite card is issued by - Vanquis

I always thought that as the IVA stays on your credit report for 6 years from the start of it, then once the iVA had been removed, that was when you would start building your credit rating back up again. Once the IVA leaves our credit file next Feb, we are not expecting to be able to obtain any credit for a while after that anyways (we wouldn't anyway). So even if you were to apply for a mortgage once the IVA has been removed, your credit rating wouldn't be that high anyway. Is this the case?
Dunno if I am making much sense. x

When I took out a IVA the standard question for mortgages used to be have you ever been bankrupt now it is have you ever entered into an arrangement with your creditors

So if you truthfully answer that question, I think you're going to shoot yourself in the foot and get tarnished with 'bad history' forever. If you don't answer it truthfully, then you risk the consequencies of them finding out down the line, albeit neigh impossible once details fall off the credit report.

Either way cannot win.

Thanks for the input everyone, much appreciated. Would still be interested to hear if anyone has successfully obtained a mortgage at a reasonable rate after the six years is up.

flow13 wrote:

I always thought that as the IVA stays on your credit report for 6 years from the start of it, then once the iVA had been removed, that was when you would start building your credit rating back up again. Once the IVA leaves our credit file next Feb, we are not expecting to be able to obtain any credit for a while after that anyways (we wouldn't anyway). So even if you were to apply for a mortgage once the IVA has been removed, your credit rating wouldn't be that high anyway. Is this the case?
Dunno if I am making much sense. x

As my IVA finished early due to a full & final settlement I had a three year window whereby I am no longer in an IVA but have a completed IVA and satisfied defaults on my credit report. This is why I applied for the credit cards so that in those three years until my IVA drops off the file I can show that I am able to manage credit responsibly. When I come to apply for a mortgage after the six years is up I will have some positive credit history. The spanner in the works seems to be that even though the IVA will no longer be on my credit file I may still be penalised.

robbo201 wrote:

Would you mind saying who you managed to obtain credit cards with, as i completed a lump sum iva 2 years ago and wanted to apply for a card, obviously only to repair my credit history, like you i have learded an important lesson in life

I initially applied for the Vanquis card (via Quidco so I got £25 cashback [:D]) around 6 months after the IVA was completed. My initial credit limit was £500, this was increased to £1000 after 3 months and then £2000 after 7 months. The interest rate is horrific but I've never paid a penny interest and don't ever intend to as I ALWAYS pay the bill off in full.

I then applied for a Sygma Silver mastercard around a year after the IVA was completed (so around 4 years after the defaults/start of IVA). I was accepted straight away and not referred for a decision as I was expecting. The credit limit is £2000 and the APR is an almost mainstream 18.9%.

Both these cards are merely a way to gain 'green dots' on my credit file as far as I'm concerned. I will never buy anything on them that I don't have the money aitting in my current account to pay off as soon as the bill comes in.

However, if you don't spend anything on these cards then your credit rating won't rebuild. You need to spend a few pounds a month - petrol perhaps? As soon as you have spent it, you just go and then pay it back. It looks better if potential creditors can see that you have been paying things back.

kallis3 wrote:

However, if you don't spend anything on these cards then your credit rating won't rebuild. You need to spend a few pounds a month - petrol perhaps? As soon as you have spent it, you just go and then pay it back. It looks better if potential creditors can see that you have been paying things back.

Sorry, didn't make it clear. I use both cards every month. I put all my day to day expenses and any big purchases on it. I keep a close eye on exactly how much I have to spend in my current account and only soend up to this amount on the credit cards. I then pay the bill off in full as soon as I get it but normally before I even get it as I check the online card services!

Sorry, I misread the post.

If you do that then it will build up your credit rating.